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RightChange: Obama Should Adopt The Keystone Rule

In light of Obama’s call for applying the “Buffett Rule” when it comes to taxes, a recent article from the Wall Street Journal makes the case for the adoption of the “Solyndra Rule.” This would ensure no company that showed every sign of failing would receive a taxpayer subsidy.  If Obama were to abide by this Solyndra rule, there would be no more green energy bankruptcies and programs like the Keystone Pipeline would be approved.  While the Solyndra rule would be incredibly beneficial to the economy, we would like to make another one: the Keystone Rule.

If we continue to vote lawmakers into office that allow the government to pick winners and losers with our money, they should at least bet on projects like the Keystone XL pipeline.  Unlike the stimulus-funded Solyndra, Keystone had bipartisan support, had the State Department’s approval, and had the potential to create direct 20,000 jobs.  That is more jobs than Obama entire energy loan guarantee program has created.

From the Washington Post:

“As it happens, Carol D. Leonnig and Steven Mufson of The Washington Post examined the job-claim figure two months ago and found it wanting. “The program — designed to jump-start the nation’s clean technology industry by giving energy companies access to low-cost, government-backed loans — has directly created 3,545 new, permanent jobs after giving out almost half the allocated amount, according to Energy Department tallies,” they reported on The Post’s front page.

The Energy Department disputed that analysis as “incomplete and inaccurate,” as evidenced by the fact that Chu repeated the claim in sworn testimony before Congress. But if you dig deeper into the 60,000 number, you find that more than half of it comes from a single program — 33,000 jobs at Ford that were supposedly converted to green technology because of a $5.9 billion loan. The Energy Department translated those as “saved” jobs, even though the number amounts to nearly half of Ford’s total workforce.”

The entire taxpayer loan program has a price tag of $38.6 billion. Half of that money was spent in September 14th, 2011 with just 3,545 new jobs created (those are the figures the Washington Post used in their analysis).  That means $4.85 million of taxpayer money was spent on each job.

The Keystone Pipeline was estimated to create between 20,000 and 100,000 jobs without a huge taxpayer subsidy.  Unfortunately for us, that was too efficient for President Obama.  If we are going to ask job creators to cough up another $50 billion a year, we should ask Obama to cancel his $38.6 billion loan energy loan program in exchange.

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